· the services to be rendered and typical
failure to clarify the CPA's role and serv-
ices to be performed. An engagement
letter should leave no room for misun-
derstanding or "creative" interpretations.
jurors) perceive CPAs as experts in
documentation, and a failure to live up
to that perception may be viewed as
negligence. When there is no accurate
written description of the engagement,
claimants can more easily assert that
the CPA was responsible for 1) provid-
ing services that the CPA did not con-
sider part of the engagement and 2)
guaranteeing the results of a transac-
tion the claimants initiated while the
CPA's services were engaged.
by the client. Failure to do so may be
interpreted as the client not agreeing to
the terms of the engagement. Going for-
ward with the work without a signature
could also suggest that the CPA com-
pleted the engagement under terms
different from those contained in the
unsigned engagement letter.
today may not be tomorrow's client.
Relationships and dispositions change
when disputes arise, and significant
events may change ownership or con-
trol of the client, including the appoint-
ment of a bankruptcy trustee or the
death of a family business proprietor.
against the phenomenon known as
"engagement creep." This involves ini-
tially well-defined tasks, or starts with a
simple question that does not appear
to rise to the level of a new engage-
ment but, over time, creeps outward to
encompass significant additional,
the existing engagement letter should
be updated. What may not be as clear
is that, even when the terms of the
actual engagement have not changed,
an engagement letter may need to be
updated when surrounding circum-
stances change, including the introduc-
tion of new service providers.
a financial planner or investment advis-
er might see themselves as "just the